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222 Confidential P&G Proprietary Business Information Unpublished Copyright P&G 2014 Some data is masked for confidentiality 1. Nationally, the Boxed Hair Color business is declining. Nationally: -1.3% during the last 52 weeks Target: -2.1% during the last 52 weeks 2. Target has historically won in beauty categories but dollars are leaking to Salons, e-Salons, and the emerging Dollar Channel. 3. Targets website capabilities have lagged those of its top competitors: Amazon.com and Walmart.com. 4. Additionally, Target is experiencing reduced store traffic due to the Holiday 2013 Credit Card Data Breach. Please refer to the attached Kantar article for more detail. Total US Color sales declined 4% from 2011-13Boomers leaving faster than Millennials entering; Leakage to Salon Hair Color Background: State of the business 2013

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333 Confidential P&G Proprietary Business Information Unpublished Copyright P&G 2014 Some data is masked for confidentiality Hair Color Background: Declined guest count Dollar sales are driven by the following 4 buckets: During the latest 52 weeks, hair color guest count has been down -3% and is declining 3x faster than the total beauty category. If guest count continues to decline by -3%, total sales are also at serious risk of declining at an increased rate. Guest Count Trips/ Guest Units/Trip Average Retail Price

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444 Confidential P&G Proprietary Business Information Unpublished Copyright P&G 2014 Some data is masked for confidentiality Hair Color Background: Barriers to entry 1. Damaging Hair2. Selecting Wrong Color3. Inconvenience Im afraid 35% of people select wrong color Im overwhelmed Research has shown that the following are major barriers for the category:

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555 Confidential P&G Proprietary Business Information Unpublished Copyright P&G 2014 Some data is masked for confidentiality Hair Color Objective: Return the Category to Growth How would you help Target understand how to bring shoppers back into their hair color aisle? Thought starters on ways to impact the store: Think about ways to leverage/enhance: (1)target.com (2) social media (3) mobile apps (4)out-of-store marketing (5) in-store education/marketing/shelving The clock is ticking and guest counts are continuing to decline due to: shifts to salon, e-salon, competitor activity, and shoppers simply no longer coloring their hair.

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666 Confidential P&G Proprietary Business Information Unpublished Copyright P&G 2014 Some data is masked for confidentiality Appendix: Targets Guest Profile 40 years old Household income of $65,000; Over 33% above $75,000 36% have children at home 65% have pets at home 57% completed college 78% are women 80% are married

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777 Confidential P&G Proprietary Business Information Unpublished Copyright P&G 2014 Some data is masked for confidentiality Appendix: Hair Color Shoppers She quickly reaching her end results, not so much the means. With end color being her sole concern, shes an ideal shopper to focus on increasing frequency. She prioritizes perfect results before efficiency. Shes willing to put forth the effort to look her absolute best. Regimen is her best friend. She wants the end result but also takes time to stop and smell the roses. She values the journey as much as the end result and is willing to try new products. B A Sensorial Sally Efficient EmilyFlawless Fiona B A